LGNZ welcomes Productivity Commission review into local government funding

LGNZ President Dave Cull welcomes Minister of Local Government Hon Nanaia Mahuta’s announcement today that there will be a Productivity Commission inquiry into local government funding.

“Ratepayers across the country are under funding stress to provide the essential services for their communities, such as three waters infrastructure, roading and housing, let alone mixed use tourism infrastructure. New mechanisms of funding are desperately needed,” says Mr Cull.

“We’ve been in dialogue with the Government around this issue for some time so it is pleasing that it has responded positively.”

“As identified by Minister Mahuta, rates in many places are already rising faster than incomes and some of the smallest ratepaying bases have the biggest costs to bear around water and tourism infrastructure. Affordability issues mean that just increasing rates is not going to work.”

LGNZ welcomes the Productivity Commission being given this role, as it has a solid track record of providing practical and reasoned advice based on evidence, not emotion.

The annual Central and Local Government Forum was held at Premier House yesterday, where Prime Minister Rt Hon Jacinda Ardern and a range of ministers hosted local government leaders from across the country to discuss the biggest issues facing local government including the development and funding of water, housing, tourism and climate change responses.

“There has been strong ministerial engagement this week and today’s announcement is a step in the right direction for the long-term. The current funding model for councils which relies solely on property tax (i.e rates) is not sustainable. LGNZ will be advocating for a greater range of funding mechanisms for its members in order to alleviate the burden on ratepayers.”